I would suggest locating data centers in a cool climate where farming is popular. Pump the waste heat from the data centers into greenhouses that can surround the data center. Now that waste is helping to grow food.

Alaska is actually a good place to implement such a solution. There is a huge amount of sunlight in the summer which, assuming you can avoid frosts, can grow amazing produce. All you need are greenhouses and a heat source. In the winter, when sunlight is no longer plentiful and farming shuts down, the heat can be pumped into local housing. Such a solution would also provide local produce in Alaska - produce that is fresh and doesn't require expensive shipping. One last point about Alaska, it's very central. It might not appear to be when looking at a map, but if you look at a globe you will see that it sits nicely between Asia and North America. I don't know where the current internet pipes are located but if they pass close to Alaska then this idea would be worth some consideration.

You'd have to have a very cheap and very power inefficient server to come even remotely close to their claims of half of the cost of the server on power. An elbaso HP Dl360G5 costs $1600. It will use about 300W at typical load, but lets call it 250W to make the numbers easier. Double this for inefficient cooling and power conversion in the UPS (this is overly costly but makes up for underestimating power usage) so 500W. There are 8,760 hours in a year so 4,380 KwH, you'd have to pay $.20 per KwH to reach their figure, this is over twice the US national average. Prices where you'd want to put a datacenter are closer to $.06-$.08 per KwH. My average server cost closer to $7,000 with battery backed RAID card, dual fast drives, dual CPU's, 4GB memory, 3 year 6 hour repair contract, etc. Even powering that kind of servers off diesel generators fulltime it would have to draw ridiculous amounts of power to cost half it's purchase price in electricity every year.

Please keep in mind there is such a thing as heat pollution. Warming the water 10 degrees can radically affect the nearby ecosystem.

I'm not saying your typical data center is going to put out the same heat as a nuclear reactor. They actually take steps to cool the water, but it's still warmer than it went in.

I certainly don't think heat pollution will be a concern. Gigawatt size coal plants and nuclear reactors have to worry about heating nearby rivers, but in this case we are talking about the additional load to run datacenters heating the Atlantic Ocean. A 1 GW electric power plant will typically reject 2 GW thermally (which is a lot of local heat). But 3 GW is a lot of power to be generated in one spot. The renewable energy sources of Iceland certainly don't generate anywhere near that much power per unit area. And the heat rejected from datacenters will be trivial and widely distributed.

I think two things will stop these datacenters from going to Iceland: restrictive immigration laws and submarine data cable capacity. Iceland has a total population of about 300,000. They simply can't have a diverse enough IT industry to support setting up these data centers without expats. And without the bandwidth, there simply isn't a point.

No, it's really not. There's nothing really "twichy" about the game that requires particularly low latency. Heck, they only keep their servers in one place and players as far away as Australia regularly play the game just fine, I don't think anyone is going to notice an additional 50ms. A bigger problem is the fact that the country is only connected by a couple of cables; a couple of weeks ago the biggest cable was cut which caused a bandwidth shortage and made internet performance tank country-wide. Such little redundancy would be a far bigger problem.

Because Iceland's geothermal energy extraction doesn't emit CO2. The extracted energy was going to leak to the atmosphere eventually anyway.

Only CO2 emission would increase global warming, which is, as the name says, global, not local. Just pumping thermal energy doesn't do so. Even huge emitters of pure thermal energy, like coastal nuclear power plants, have significant effects only in their immediate vicinity.

Actually, his analogy is even weaker, because the distance between Anchorage and New York is icy tundra, for the most part, while the distance between Iceland and Amsterdam is mostly open ocean. Now, which do you think is a lot easier to lay thousand-plus miles of fiber optic cable through?:-) (Hint: We routinely do the latter at one go, and cables in the Mediterranean are often laid in the water to avoid political issues.) Not to mention Iceland is quite close to Scotland; a mere 650 miles. (The economics may still make it more sensible to lay a cable all the way to Amsterdam, though; heck, many existing cable routes go from New York to Amsterdam, wrapping around Scotland without touching land.)

The distance is more like laying a cable from Anchorage to Vancouver. Or for a distance measure that might be a bit more intuitive to most Americans (since nobody pays attention to that big invisible mass in the middle;-) ), it's a little more than the distance from Seattle to San Diego, or almost exactly the distance between Boston and Miami. Considering we lay cable across huge sections of oceans all the time (including right across the Mid-Atlantic Rift; a concern because of Iceland's high geologic activity), this isn't such a big deal.

Iceland is relatively unconnected because of low demand, not because it's particularly hard to do so.